Review of Maritime Transport 2011 - Unctad

CHAPTER 1: DEVELOPMENTS

CHAPTER 1: DEVELOPMENTS IN INTERNATIONAL SEABORNE TRADE 21 economies. It has been estimated that if a 30 per cent increase in global food prices persists throughout 2011, GDP growth for some food-importing countries in Asia, for example, could decline by 0.6 percentage points. 52 Combined with a 30 per cent increase in world oil prices, the reduction in GDP growth could reach 1.5 percentage points compared with a situation with no hikes in food and oil prices. 53 Clearly, there is a need to improve productivity, increase agricultural investment, and adopt all measures necessary to enhance food security especially for the more vulnerable populations. Bauxite/alumina and phosphate rock In 2010, world trade in bauxite and alumina rebounded by a strong 22.7 per cent, and totalled 81 million tons. With Europe, North America and Japan being the main importers, the strong recovery reflects the improved situation in industrial activity in these economies and the continued investment expenditure in emerging developing economies supported by the stimulus funding and the rapid pace of industrialization. The major loading areas for bauxite included Africa, the Americas, Asia and Australia. Australia was also a major exporter of alumina, accounting for about half of world exports, while Jamaica contributed a growing share. Rock phosphate volumes bounced back at a firm rate of 21 per cent, to 23 million tons, reflecting the improved economic situation in main importing countries such as the United States. Increased grain production encouraged by higher prices and growing demand, especially from Asia, helped boost demand for fertilizers. Some easing of the credit conditions may have also helped in relation to the sale of farm inputs such as fertilizers. Phosphate rock volumes are expected to remain steady in 2011, partly reflecting further consolidation in the economic recovery and demand for grains. Plans are still under way for the expansion of existing operations, for example in Brazil, China, Egypt, Finland, Morocco, the Russian Federation and Tunisia. Once operational, supply and demand and the underlying shipping patterns will likely be affected, especially as regards demand for handysize capacity and deployment. Dry cargo: minor bulks In 2010, minor bulks trade also recovered from the 2009 dip and expanded by 11 per cent,- taking the total volume of minor bulk shipments to 954 million tons. Overall, trade in minor bulks fared well, although imports remained around 3 per cent below the pre- downturn levels. Steel and forest product trades account for the largest growth in terms of volumes while in terms of growth rate, coke (78.7 per cent) and potash (59.7 per cent) trades recorded the most significant year-on-year expansion. With the bouncing back of the world steel production, scrap volumes increased by 10 per cent to reach 98.8 million in 2010, a level almost equivalent to the 2008 level and above the 2007 level. Strong demand and favourable weather conditions supported growth in sugar and rice shipments, which increased respectively by 10.4 per cent and 7.8 per cent in 2010. Trade in the majority of fertilizers rebounded strongly (16.9 per cent), whilst imports of metals and minerals such as manganese ore and cement all increased in tandem with the resurgence of the global steel production and construction industries. Minor dry bulk trades are projected to grow by 5 per cent in 2011, driven in particular by strong growth in agribulks, metals and minerals and manufactures. Other dry cargo: containerized cargo The balance of 2.4 billion tons of dry cargoes is made up of containerized (56 per cent) and general cargoes. Driven largely by the increasing international division of labour and productivity gains within the sector, container trade, the fastest-growing cargo segment expanded at an average rate of 8.2 per cent between 1990 and 2010 (tables 1.7 and 1.8 and figures 1.5 and 1.6). Container trade volumes experienced an unexpected robust recovery fuelled by a surge in demand across nearly all trade lanes. In 2010, global container trade volumes bounced back at 12.9 per cent over 2009, among the strongest growth rates in the history of containerization (figure 1.5). Table 1.7 features container trade volumes on the three major East–West container routes from 1995 to 2009. Over this period, the continuing expansion in container trade volume is compelling, as is the drastic drop in volumes recorded in 2009. According to Clarkson Research Services data, container trade volumes reached 140 million 20foot equivalent unit (TEUs) in 2010, or over 1.3 billion tons. Growth in container trade volumes was propelled by the double–digit rates involving Asia, namely Far East– North America and Asia–Europe (table 1.8). Volumes on these two largest East–West trade lanes are expected to exceed 2008 levels. However, volumes on the transatlantic lane, which experienced a drop of 19 per cent in 2009, are expected to remain below

22 the pre-downturn levels. While the transatlantic lane is gradually diminishing in global importance, Western Asia’ s trade with developing economies in the Indian Subcontinent and southern hemisphere is expanding rapidly. It should be noted that, although conditions have improved, slow steaming continues to be implemented by container operators as a way of cutting costs of fuel and absorbing capacity as well as a move to fulfill other strategic objectives such as energy efficiency and environmental sustainability, including cutting carbon emissions (see section C and chapter 2). Growth in 2010 is estimated to have been more robust on North–South (14.1 per cent) and non-main lane East–West trades (18.7 per cent). This has been illustrated by the Europe to South/Central America trade, which grew by 20.1 per cent in the first quarter of2011 and Europe to sub-Saharan Africa trade, which grew by 27.5 per cent year-on-year over the same period. Meanwhile, intraregional trade grew by an estimated 11.6 per cent in 2010, propelled by intra-Asian trade, which continues to be fuelled by growth in developing economies such as China. Figure 1.5. Global container trade, 1990–2011 (TEUs and annual percentage change) 180 160 140 120 100 80 60 40 20 0 REVIEW OF MARITIME TRANSPORT 2011 Along with fast-growing intraregional trade, these emerging lanes provided a market for the deployment of cascaded ships. With trade growing at a faster-than-expected rate, the container sector was caught by surprise and created a shortage of container equipment in particular empty boxes. The shortage of containers observed in 2009 resulted from the large-scale scrapping of old boxes during the downturn, low production levels and financially strapped carriers, and their attempts to cut costs, including that of repositioning empty boxes. Equipment and ship capacity shortages that were experienced following a rebound in demand in the fourth quarter of 2009 and early 2010 have led to a fact-finding investigation by the Federal Maritime Commission into the availability or non-availability of supply capacity on the transpacific trade during that same period. 54 While it was concluded that no clear evidence was found as regards unlawful practices by carriers, ocean liners were nevertheless urged to ensure that capacity shortages are prevented in the future. Also, Global Alliances (Grand, Green and New Million TEU (Left) Percentage Change (Right) 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: Drewry Shipping Consultants, Container Market Review and Forecast 2008/09; and Clarkson Research Services, Container Intelligence Monthly, May 2011. Note: The data for 2011 were obtained by applying growth rates forecasted by Clarkson Research Services in Container Intelligence Monthly, May 2011. 20% 15% 10% 5% 0% -5% -10% -15%